The advice "buyer beware" should rule the day when Donald Trump's Truth Social, which has never shown a penny of profit, starts trading publicly, financial writer Adam Lashinsky argued Monday.
Lashinsky issued this warning in the Washington Post one day before the former president's media company is slated to begin trading under the ticker name “DJT” on the Nasdaq Stock Market.
The former executive editor for Fortune admitted he is not one to normally give investment advice, but argued the securities filing from the former president's Trump Media & Technology Group has enough red flags in it to give any investor pause.
"I assure you that a company with $3.4 million in revenue and $49 million in losses over the past nine months is not worth $5 billion," Lashinsky wrote. "Buy into shares of any company with those numbers and you are certain to be taken for a sucker."
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Lashinsky believes anyone who invests in the fledgling company stands a good chance of being "bamboozled" by putting money in Trump's pocket, arguing Securities and Exchange Commission filings contain a plethora of red flags about his business failures.
After mentions of multiple business failures including bankruptcies, the filing, according to Lashinsky, includes the murky promise of growth based on "adhering to traditional key performance indicators, such as signups, average revenue per user, ad impressions and pricing … could potentially divert its focus from strategic evaluation with respect to the progress and growth of its business.”
In short, Lashinsky labeled that gem as a "financial word salad," which he translated as: "Truth Social hasn’t amounted to much so far; pay no attention to our lack of specifics."
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Lashinsky cites the disclosure specifically to back up his claim.
"The Trump Taj Mahal, which was built and owned by President Trump, filed for Chapter 11 bankruptcy in 1991," the quotation reads. "The Trump Plaza, the Trump Castle, and the Plaza Hotel, all owned by President Trump at the time, filed for Chapter 11 bankruptcy in 1992.”
The columnist pointedly singled out a warning that stated, "Trump Steaks, a brand of steak and other meats founded by President Trump in 2007, discontinued sales two months after its launch. … There can be no guarantee that [Trump Media’s] performance will exceed the performance of those entities.”
Lashinsky told potential backers, "Investors who persist in backing Trump cannot say they weren’t warned."